The housing party is officially over, according to the Arizona Blue Chip Economic Forecast.

Although home sales plummeted, appreciation has held the line. But second-quarter 2007 saw an 0.3 percent drop in value compared with the first three months of the year and a national increase of 0.1 percent.

The only other Western states showing a decrease were California and Nevada, according to the Blue Chip. In Arizona, Flagstaff saw the biggest drop at 0.6 percent from the first quarter. Values in the Phoenix area dropped by 0.5 percent.

Those declines, however, are minor compared with long-term appreciation. Arizona housing values have double since 2001, according to the report, and even homeowners who bought a year ago saw a 2.2 percent rise in value.

Business Journal of Phoenix